The CFTC has found Silver Star FX, LLC, which operates under the name Silver Star Live (SSL), Silver Star Live Software LLC (SSLS) and their operator David Wayne Mayer (also known as Quicksilver) liable for solicitation fraud in forex transactions, Commodity Trading Advisor (CTA) fraud and multiple CFTC registration violations.
The court found that between July 2018 and March 2019, the defendants fraudulently solicited customers to open discretionary trading accounts. They offered their clients to trade those accounts, through a fully automated retail forex trading software system which Mayer created.
According to the court’s findings, the defendants promoted their services through online videos, social media and in-person marketing events with material that misrepresented Mayer’s qualifications and trading experience. Moreover, they also exaggerated the forex trading system’s performance history and expected trading profits.
The defendants failed to disclose that Mayer never opened a live trading account using the forex trading system. Additionally, Mayer did not register as an associated person of a CTA and SSL and SSLS unlawfully permitted Mayer to become or remain associated with them.
SSLS and Mayer have been ordered to pay over $3 million in restitution and SSL – $198,143. SSLS and SSL have been further imposed penalties of $9.798 million each and Mayer has to pay additional $1.338 million.
The defendants are also forbidden from conducting activities which violate the Commodity Exchange Act (CEA), registering with the CFTC, and trading in any CFTC-regulated markets.
The CFTC noted that in a previous, related case, SSL and SSLS acted as unregistered CTAs, and two former officers acted as unregistered associated persons of both companies.
CFTC recently brought up new charges against six entities from Florida. These entities consist of three individuals as well as three associated companies. The individuals involved in the scheme were; Robert Johnson, Ross Baldwin and Kathleen Hook, who are all subject to litigation as well as the affiliate companies PIC, NCBWC and NCB.
